Market update

Turkey’s central bank indicated in a meeting with economists today that its adjustments to interest rates will depend on the pace of rate increases by the Fed, according to two economists attending the briefing. They also added that:

Turkish rate moves to depend on global financial situation
Should Fed move quickly to raise rates, the Turkish central bank’s moves could be abrupt; a slower pace would also reflect on Turkey’s moves
Bank stresses that its current process is one of normalization along with global monetary policies, not necessarily directional as far as tightening liquidity

Situation is getting more and more difficult for the Turkish Central Bank as the lira sinks amid arising political tension in Turkey. USDTRY has broken above 2,90 and approaches recent heights. 

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